Ways to Earn Profit from Tax Lien Certificates

When you buy a tax deed, the only way you can make money out of it is either by selling the property or rent it to interested people.  But did you know that when you buy tax lien certificates, there are ways you can earn profit from it?  These ways are explained below.

The first way that you can earn profit from tax lien certificates is by its redemption.  When the homeowner redeems the lien, you are going to be paid the amount of the certificate plus interest and any penalties as the lien holder.  The rate of interest in most states is based in an annual rate.  This means that the longer the lien is held, you would make more money when the homeowner redeems it, which in most cases happen.

Another way to make money from lien certificate if the homeowner does not redeem is to begin foreclosure of the property.  The foreclosure process may be easy or complicated depending on the state that issued the lien certificate.  Do this so that you would be paid with the owed lien amount.

Last way you can earn profit from your tax lien certificate investment is by assignment or sale of your lien certificate to another interested investor.  Some states in the US allow this method.  You can collect profit from this without the need of redemption or foreclosing.

Be Sociable, Share!

• 
•